Most Ad-Funded iPhone Apps Don't Earn Enough To Buy A Sandwich

iPhone ads are an easy way to make money from your app, but they’re not going to do anything if you don’t have enough users.

In a new report (PDF), mobile ad network AdMob says that 54% of the 2,300 apps that its ads appear in had fewer than 1,000 users in May. That’s not going to pay the bills.

Meanwhile, the big hits — 5% of the market — had more than 100,000 users. The biggest had more than 2 million, and it looks like about 11 apps had more than 1 million users. (See charts below.)

How much money is a 1,000-users-or-less app making on ads per month? Probably not enough to buy a sandwich.

We estimate that a low-end, ad-supported iPhone app can expect to make a net eCPM around $1-$2. Translation: For every 1,000 times an ad loads on your app, you’d get $1-$2 after sharing revenue with the ad network. Assuming a 1,000-active-user app actually gets 1,000 people to look at, say, 10 ads per month, that’s a mere $10-$20 in revenue. Assuming 500 users and 5 ads a month… you get the idea.

Premium apps with hundreds of thousands of users — and access to better ads — can expect much more, of course.

Standard disclaimer: This is only a representation of apps using AdMob’s ads — NOT necessarily a representation of the broader iPhone app market. These apps might not be loading AdMob ads, may have other ad plans, or other revenue generators in place.

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